As of this morning, DreamWorks and Universal’s engagement is off, and it’s being reported that the former may enter a relationship with Disney instead. How ironic will it be if DreamWorks’ distribution deal indeed ends up at Disney? And how pissed off will Jeff Katzenberg be? After all, he resigned from the Mouse House and then cofounded DreamWorks with Steven Spielberg and David Geffen and used the studio’s animation branch to parody and compete with Disney movies. Sure, DreamWorks Animation is now a separate entity from the main studio, so Katzenberg won’t have anything to do with Disney if the deal goes through. Well, except that his company will share a logo with a Disney-partnered production company. As much as Universal seemed an appropriate home for Spielberg and co., Disney seems completely inappropriate, in a way that’s like sleeping with your best friend’s ex.

Here’s what the rest of the blogosphere has to say about the potential partnership:

• Nikki Finke, who continues to bring updates on this news, hears the deal with Disney is done and will be officially announced Monday. In addition to having all the details on how and why the love triangle exploded, Finke shares this interesting exchange: “I’ve also learned that, today, [DreamWorks' Stacey] Snider phoned Universal Studios prez/COO Ron Meyer to apologize. ‘We had to do this. Our backs were against the wall. We couldn’t tell anyone about our discussions with Disney.’ To which Meyer replied, ‘What you did was wrong on every level. You guys behaved like pigs.’ [I now hear that Snider is deeply offended Meyer called her that.]“
• One of the first places to report the story was NY Times‘ ArtsBeat blog, where Brooks Barnes and Michael Cieply bring up the original desirability of Universal over Disney: “Disney had been a suitor for DreamWorks back in October, and Stacey Snider, the chief executive of DreamWorks, and David Geffen, the co-founder of the studio, were keen to align with the company. But Mr. Spielberg ultimately overruled them, concluding that Universal – where he made his first blockbuster and where he still maintained offices – was the right fit.”
• At the LA TImes‘ The Big Picture blog, Patrick Goldstein says the news is fascinating on two fronts: “First off, it’s a quasi-admission by Disney that it needs more quality movies in its pipeline, which in the past couple of years had been restricted largely to very targeted family entertainment from its Disney, Pixar and Jerry Bruckheimer brands. DreamWorks, with Stacey Snider at the helm, would presumably deliver more adult-oriented films — in other words, films very similar to the classy Touchstone pictures that Disney has largely phased out after unceremoniously pushing production chief Nina Jacobson out of her job several years ago.”
• “Honest, really…who cares? What does it matter?” asks Jeff Wells, “How much better can DreamWorks partner Steven Spielberg, whom I sometimes think of as the bearded and beaming Noah Cross of modern Hollywood, live or eat or dress? What has this deal have to do with the price of rice and the basic nutrients that we all need from good movies on a regular basis? I’ll tell you what it has to do with them. Not much.” He then goes on to discuss how Spielberg should have made and released his Lincoln biopic already, though for the Obama zeitgeist rather than the fact that it’s Honest Abe’s 200th birthday.
• Gawker notes how bad the economy is when Spielberg can’t make it these days: “We are talking about the Father of the Modern Blockbuster here. People don’t say no to Steven Spielberg because he’s scary, they don’t say no to him because his shit makes bank. But the ever-hungry maw of the current economic sinkhole knows no name or status. And now he’s scrambling to finance his DreamWorks production house, what does that say for the rest of the industry? For the little humble producers hoping to get studio deals? Well it ain’t good.”
• Regarding the idea that a deal with DreamWorks means Disney will have to unload Miramax, Defamer agrees and sees a potential buyer: “They can’t afford both. Maybe Harvey Weinstein can get it back cheap; in this economy, someone will.”
• John Frost, at The Disney Blog, believes the Miramax sell would be unlikely, because “it is Disney’s best bet at Oscar Gold each year.” He also excitedly writes, “If anything this bodes well for the rumored sequel to Who Framed Roger Rabbit? Disney would have to team with Amblin again to make the sequel. Having Steven Spielberg on your team should make that a snap.”